Hidden Dangers of Offshoring

There has been a trend by many corporations to outsource their use of call centers. However, do you know the hidden risks associated with international call centers? Many companies relocate their call centers to overseas and face a higher security risk at these international call centers. As identity theft is our nation’s fastest-growing crime, with ten million victims each year, extra precautions must be taken for secure transactions. While these systems are regulated at call centers within the United States, call centers outside are not tied to these laws.

Call centers are used in a vast array of businesses including: IT analysis and design, engineering, animation, telecommunications, technology, health, financial, and retail industries. These centers are a valuable source of jobs in the U.S. employing nearly 4% of our nation’s workforce, or as many as four million jobs. However, the intense competition for cheaper, less regulated foreign operators is creating downward pressure on wages and working conditions here at home. American corporations like Capital One, JPMorgan, Hewlett-Packard, T-Mobile, Wells Fargo, Citigroup, and Bank of America are all outsourcing call center jobs away from U.S. communities. The local economy takes a major blow in small and medium-size communities when these jobs are outsourced, forcing workers to relocate. On average the employees may experience longer periods of unemployment with greater long-term income loss. Some of these corporations have even gone so far as to make soon-to-be out of the job employees travel to newly outsourced call centers to train their replacements.

Other than the purely economic issues surrounding this outsourcing epidemic is the lack of security that these under-developed countries offer. These corporations are trading profit increases at the expense of consumer safety and privacy. Virtually every state in America has “Data security breach notification” laws to alert individuals and local government officials of possible identity theft, but once these corporations outsource internationally U.S. consumer data leaves that legal protection behind. If the data in question were not so sensitive, the level of security that is in place at most of these facilities may serve its purpose. The CEO of an outsourced company in Jamaica went on record as saying that they literally staple the pockets of employees shut as a security measure against theft of sensitive information. Police forces in numerous countries where these call centers are most prevalent all say if consumers only knew how easily and cheaply their confidential details were sold they would immediately terminate their business with these corporations. A major concern regarding security in some foreign call centers is that the accountability is placed on the individual employee and not on the corporation. The legal team that creates the policies for these corporations are writing their own rules and displacing the blame away from themselves due to the lack of over sight in these under developed countries. Even in the event that someone did build a case for the fraudulent behavior being exhibited, in most instances it is unclear which national regulatory authorities they should report the crime to. Furthermore, several developing countries do not even admit electronic evidence; this makes prosecution for cybercrimes or any crime that requires electronic information evidence unrealistic, if not impossible.

Foreign outsourcing has traditionally been practiced by the United States, but companies in the United Kingdom, Japan, Australia and New Zealand are now following suit. The economic recovery and rebuild could be positively influenced by inland call centers. It would benefit the consumers if laws were passed that would require companies to inform them about how their private data is handled. While there is a temporary benefit of low cost for the company, the real cost is that the consumer loses the security of their information.